Author 




Title 



Imprint. 



IR— 47372-2 OPO 






THE MONEY CRISIS: 




CAUSES AND REMEDY. 



BY 



ALFRED YAPLE 



CINCINNATI: 

ROBERT CLARKE k CO 



>''€ 



,i 



THE MONEY CRISIS 



ITS 



CAUSES AND REMEDY. 



BY 

ALFRED YAPLE 



CINCINNATI: 
ROBERT CLARKE & CO 

1873. 



THE MONEY CRISIS: 



ITS 



CAUSES AND REMEDY. 



To ascertain the causes of the present financial condi- 
tion of the country is essential to the discovery and 
adoption of the proper remedy. 

That something can not be made by men from 
nothing; that to assume that any number of so-called 
cents less than one hundred is a dollar is false ; that a 
government can create or possess no wealth other than 
that given to it by the people from their stores ; that 
the wealth of a people consists only of the surplus of 
their productions, or creations of labor remaining after 
all that they consume or destroy is deducted ; that the 
finite is not infinite, or the limited unlimited, and that 
the wealth and resources of any people or nation can be 
exhausted, are axiomatic truths. When, then, any 
government finds itself without the means to pay the 
expenses of all the undertakings in which it is engaged, 
and, in lieu thereof, emits its promises to pay in any 
form, it anticipates the existing wealth in the hands of 
the people, or what they are to produce and save in the 
future, or both ; and they are finite. And such prom- 
ises must be intrinsically as much less in value than 
real money, the measure of all values, as the interest 
for the shortest time possible to collect the money from 
the people and pay such promises will amount to. 
When any government adopts the policy of issuing such 



The Money Crisis 



anticipatory promises, it may do so to the extent of all 
the wealth of the country, and all that the existing and 
future generations of the people may thereafter produce. 
If such promises bear no interest, and they be so nu- 
merous that none of them can be paid sooner than six- 
teen and two-third years (supposing the rate of interest 
to be six per cent.), they are practically worthless — the 
present worth of a dollar bearing no interest for that 
time being reckoned zero. This will guide us in fixing 
such values for intermediate periods. If such antici- 
pations be funded, i. e., put in the shape of interest- 
bearing bonds, then, if the government shall continue 
stable and strong enough to coerce the payment of taxes 
to pay such interest in money as it falls due, such debt 
will have a present value, however long it may have to 
run, even though the property and earnings of the pres- 
ent and the coming generation may not be sufficient to 
pay the principal. The danger, in such case, to be ap- 
prehended, would be the stability and strength of the 
government ; for the coming generation might think that 
its predecessor had been too greedy in its endeavor, not 
only to consume all its own property and earnings, but 
also that of the succeeding: they might think that it 
was against nature for one generation of men to appro- 
priate to themselves the earnings of all men in future 
times, leaving them simply to toil for the dead ; that 
the old hive had no right to devour all the honey to be 
made by its future swarms. The realization of this 
condition of things renders the idea of a tyrannical gov- 
ernment with its iron hand of force — a standing army — 
congenial to a sense of safety and the security of in- 
comes. 

If such government promises (anticipations of future 



Its Causes and Remedy. 



resources) be made a legal tender — that is, if people 
be compelled to receive the promised dollar as and for 
an actual dollar, when it must, in its very nature, be 
worth less — the debtor class are at first the gainers of 
the difference in value between the two, and the plan 
begins with immense popularity; and as it is so much 
easier to promise than to create, the scheme is sure to 
be overdone. The example is catching. Such issues 
being superabundant, lead the people into feverish 
schemes of wild speculation and enterprises, to carry 
out which they issue their promises based upon the an- 
ticipated gains of such undertakings. They call these 
promises "stocks," etc.; and all are soon deceived by 
the supposition that such debts are wealth, and act ac- 
cordingly, until the mistake is discovered by the failure 
to receive any interest on them. Then they find all 
mere debt — worthless promises by somebody to pay — 
anticipations impossible of realization. If th : govern- 
ment attempts to retrace its steps, and work its prom- 
ises up to the value of their face in money, it can only 
do so by exacting from the people, in the shape of 
taxes, part of their actual wealth already created and in 
hand, which must produce greater or less distress ; and 
then, also, the debtor class has to pay to the creditor 
class as much more per dollar as the value of the prom- 
ise increases ; the process is now -changed, the engine 
reversed. Thus, say one hundred and twelve dollars 
in legal tenders is to-day only worth one hundred dol- 
lars in gold. The debtor buys on the legal-tender 
basis ; his debt falls due a year hence, when, we will 
suppose, the action of the government has made the 
paper equal to gold : the debtor must pay one hundred 
and twelve dollars in gold, or its value, when, if values 



The Money Crisis 



had remained as at the time of his contract, he would 
have only to pay one hundred and twelve dollars in 
paper of the value of one hundred dollars in gold. He 
loses twelve dollars in gold by the system adopted. 
Resumption of specie payments makes the debtor class 
pay the difference between paper and gold during the 
entire continuance of the process. It would be instruc- 
tive, were it germain to the present purpose of the 
writer, to show how this, together with other necessary 
parts of the system — interest-bearing bonds, banks cre- 
ated with and upon the debt, and high tariffs— tends, 
inevitably, to prevent the man who earns the dollar 
from keeping it, and to vest the wealth of a country in 
few hands. Another effect is to divert the energies of 
men from real business to be employed in mere 
wagering. 

The almost daily contraction and expansion of the 
value of such promises, as compared with coin, tempts 
to "betting" on the value upon a given future day, 
which buying and selling "short" simply is. Combi- 
nations — "rings" — are then formed to affect values at 
given times, from which real interests suffer. More 
grain and pork, gold and produce of all kinds, are, in 
form, bought and sold than there is in the land, the 
parties never expecting to deliver or receive any of the 
article, but only to pay or take the difference between 
the contract and the then market price. With a fixed 
measure of values, fluctuations would be too little to 
admit of heavy gambling. But, with the credit standard, 
all real business, that founded upon the actual gold and 
property of the country, is at the mercy of such 
gamesters, when the actual property of the land, affected 



Its Causes and Remedy. 



only by the laws of supply and demand, ought to 
regulate markets. 

The evil is greatly increased, if the surplus promises 
be funded in various classes of bonds. Then " rings," 
who are able to choose or control government agents, 
favor one class to-day and reap gain, another to-morrow 
and reap more. This was well illustrated (except that 
no charge of combination between government officers 
and " rings " is intended to be made) during the 
present crisis. . The government gave currency for all 
bonds of former issues, except ten-forties. This -at 
once lessened their value. Besides greatly promoting 
wagering, the system of issuing more than one class of 
interest-bearing debt is a mistake. It is condemned by 
every political economist, and defended by none. It is 
an admission that the financier does not know the value 
of his own government's credit, but is experimenting. 
His first loan, that most favorable to the creditor, he 
may work off. This then competes with the next in 
series in the world's market, and thus the nation's 
credit is made to fight itself Ex-Treasurer Boutwell's 
last scheme is peculiarly liable to this objection. But, 
as no business can be successfully carried on indefinitely 
upon what one owes instead of what he owns, upon 
what he hopes to realize instead of what he has — as, for 
instance, a corn or cotton raiser can not prosper by 
anticipating now his next two, three, or half-dozen 
crops — so the country, whose people have ultimately to 
pay it, can not permanently flourish upon the business 
basis of the government's debt. By concentration and 
by binding all business up in the plan, it will last 
longer; but, in the end, the fall is so much the higher 
and harder, and the wreck and ruin so much the more 



lo The Money Crisis: 



complete. This has been the universal experience of 
mankind, and is demonstratively inevitable. But, 
while the system lasts, before it has begun to decline, 
men never have been convinced of the fact, it being so 
much more easy and agreeable to anticipate than to 
realize. 

They therefore cherish the delusion that, in the 
given instance, their affairs are exempt from the 
operation of inevitable and unchanging laws. But, 
after the system of anticipating or borrowing from the 
future has been carried beyond reasonable limits, then 
every new resort to it by issuing further promises 
produces immediate and very observable evils. Such 
additional promises merely lessen the purchasing power 
of the aggregate mass of promises already out to an 
amount equal to the increased issue, and nothing is 
really gained in the present, while the burden for the 
future is increased just so much. This is not the case so 
long as the limit to which debt may be safely incurred, 
has not been reached. 

One terrible consequence follows — the best part of the 
productive classes are immediately injured. All who 
are engaged in raising, manufacturing, and handling 
natural products from the time seed is sown, a tree cut 
down, or a stone quarried until the article reaches the 
hands of the ultimate consumer or user, are producers 
or creators of property and wealth. The best part of 
these have permanent employment, and therefore a 
fixed rate of wages — a salary. Every new issue of 
promises, circulating as money, lessens so much the 
purchasing power of such wages, and thus takes off so 
much from it. And while such issues thus positively 
tax productive labor, they do not give any real relief to 



Its Causes and Remedy. ii 

others; for lessening their value still more than formerly, 
and thus driving coin farther away from circulation (it 
being a truth that if there be two kinds of dollar, or 
guineas or pounds, the cheapest only will circulate as 
money), the paradoxical condition of things will exist 
that there is both too much and too little money in 
circulation, and increase simply gives a correspondingly 
less purchasing power. 

This system can sustain itself longer in the United 
States than in a country whose resources are fully de- 
veloped, and especially than in one having no product- 
ive mines of the precious metals. It is a demonstrable 
fact — a fact conceded by political economists — that the 
adoption of a paper-promise system of money, including 
all amounts, from the largest to the smallest, will drain, 
if continued, the nation adopting it of all its precious 
metals. The products of our gold and silver mines 
have gone abroad to enable us to float our paper at 
home, together with a large amount of gold and silver 
we had on hand when the paper-promise system was 
adopted. I think there is some $50,000,000 less now 
than then ; but this does not give an adequate idea of 
the inevitable drain. At first our debt was owned by 
our own people; but it was funded in bonds, payable in 
coin, the great mass of which was taken abroad, for 
which gold in hand was realized. These, with constant 
interest, have yet to be paid in gold, which will go 
abroad, and thus we can form some idea of the inevitable 
drain of the system. To the extent of their productions 
our gold and silver mines have ameliorated the situation. 
Next, the resources of our country are not half devel- 
oped, and " flush times" always quicken human energies, 
and, in such a country, lead to the development of 



12 The Money Crisis 



natural resources, and this insures larger production. 
From this, however, must be deducted increased waste; 
people under such circumstances always become more 
extravagant. This extravagance reaches the producing 
classes as well as others, while many turn mere gamblers, 
cloaking their real calling under the respectable appella- 
tion of business. But sooner or later the system must 
fail ; a settlement forces itself; a crash is the result, and 
suffering, misery, and ruin are wide-spread and every- 
where. Our present system was not, by Mr. Chase, 
its founder, and our wisest financiers, expected to last 
longer than the close of the war, when a general crash 
was anticipated ; but gold production, an undeveloped 
country, and the sale of our bonds abroad by Secretary 
McCulloch, at a cheap present rate (for gold), at a high 
rate of interest, averted the catastrophe for a few years, 
to make it all the worse when it should come. To give 
another dram to the inebriate can not prevent threatened 
delirium tremens. It has been found as impossible to 
create something out of nothing as to achieve "per- 
petual motion," or to *' square the circle." 

After the system was adopted and before a safe limit 
of debt had been reached or passed, but enough incurred 
to enable debtors to pay less than they owed and be re- 
leased, while property seemed to rise as the money with 
which it was bought fell in value, and every man's 
credit was taken instead of requiring from him money, 
it was vain to attempt to argue the system — many 
shrewd ones were making money by it and all thought 
they were. That settled the fate of argument. It was 
voted mere "speculative theory," having no application 
to our particular case. After such limits had been 
passed, the subject became too dangerous to discuss. 



Its Causes and Remedy. 13 



It could no more be touched than the slavery question 
in the South just before and during the late war. It 
might bring ruin, and though ruin to thousands was 
inevitable some day, each man, who, if it came then, 
would be involved in it, expected to get safe before it 
would come of its own accord. Then for a statesman 
to say, "The way to resume specie payments is to re- 
sume," was instant political annihilation. 

Another thing has tended greatly to popularize the 
system adopted by us. The non-interest bearing por- 
tion of the debt was put in the shape of currency, and 
all local emissions were taxed out of existence. This 
gave uniformity to the value of such currency through- 
out the entire country. This has been seen and felt by 
everybody from the first, and the weakness of the 
foundation upon which the superstructure rests has 
been unheeded. Had such currency been redeemable 
in coin, at the will of the holder, without loss, then, 
indeed, would it have been the best shape in which a 
large part of the public debt could exist ; for it would 
be drawing no interest, and, at the same time, furnish 
a safe and uniform currency, less bulky and costly to 
transport than gold. 

The aggregation of such elements, and the shift by 
which we realized a large present amou'nt of gold from 
Europe by the sale of bonds on which we pay a high 
rate of interest, and must yet pay the principal, the full 
face of the bond, causes a general belief that it has been, 
upon the whole, one of the wisest and best systems of 
finance ever devised by man, and without which we 
could not have successfully prosecuted the late war and 
preserved the Union. This theory has the advantage 
of having been tried, while no other, though it might 



14 The Money Crisis: 

have been far better, more economical and efficient, 
was. 

Its real merits and defects will never be realized until 
the system shall have worked out all its necessary re- 
sults. It is a fact, that by its adoption, the war was 
carried on for two years and a half without the levy and 
collection of a cent of tax, except a small real-estate 
one, which it was soon found could not be made legally 
valid or enforcible beyond the limits of the federal 
authority, there being no allegiance due to the govern- 
ment from those it was unable to protect in the revolted 
states. This caused such promises to depreciate, and 
the government to promise to pay a dollar for every 
half-dollar's worth, or less, that it obtained; and, hence, 
virtually doubled its expenses. Taxation was not re- 
sorted to, because our then rulers were timid, afraid the 
people would not submit to taxation ; when the truth 
turned out to be that the courage and self-sacrificing 
spirit of the people were far greater than the authori- 
ties possessed. But for the people the struggle would 
have been given up. But there was not one hour from 
the time Sumter was fired upon until the surrender of 
Lee and Johnston, that peace could have been made 
upon the basis of separation, and those making it al- 
lowed to live in the country for a single day. The 
feeling and disposition of the people was, then, wholly 
misunderstood at the start. When, therefore, Mr. 
Chase, as secretary of the treasury, in December, 1862, 
recommended the adoption of the system, James Gal- 
latin, a banker of New York, and son of Albert Gal- 
latin, urged upon his attention the feasibility of main- 
taining specie payments by a proper system of taxation, 
which would accomplish our purposes fully, and make 



Its Causes and Remedy. 15 

the war cost far less. The then subtreasury law au- 
thorized the issuing of government notes, payable on 
demand, which, with an immediate and effective system 
of taxation, Gallatin thought would carry the govern- 
ment safely through. What evidence have we that it 
would not? What that it would ? Great examples are 
before us. The methods adopted in Europe, by the 
different states, for carrying on the great wars growing 
out of the French Revolution. Take, for example, 
France and England, and commence with the first con- 
sulship of Napoleon, in 1799. Napoleon was a prodigy 
in his ability to comprehend, instantaneously, the ex- 
istence and strength of resources, and to combine and 
use them. This made him too bold and direct for a 
successful diplomat, and his boundless ambition to 
rule the world prevented him from conceding anything. 
These were his defects. 

When he reached the Tuileries, on the first night of 
his consulship, his attendant remarked : " Well, we are 
here." '*Yes," said Napoleon, "but this is nothing; 
how to stay here is what is to be considered." He met 
there all the ministers of public affairs and others, cele- 
brated political economists. He found that the previ- 
ous directory had declared bankruptcy on the revolu- 
tionary debt, with all its forced paper assignats. There 
were also outstanding debts for the years five, six, and 
seven. The assessments for the year six had not even 
been made out, and not more than one-third for the 
year seven. All for the year eight was to be met. He 
could not obtain a loan for more than 12,000,000 
francs — hardly sufficient for a single day. War was 
being carried on in Egypt; Moreau, with a large army, 
was on the Rhine; war in Italy; La Vendee unsettled; 



1 6 The Money Crisis : 

civil war in France ; all the armies long unpaid. He 
was anxiously inquired of, by his baffled and appalled 
statesmen, as to what he intended to do. He replied: 
"I shall pay cash, or pay nothing." Upon this plan 
he set to work, dividing tax assessments into many 
short installments, so that those who paid scarcely per- 
ceived that they were burdened. For the year nine, 
after meeting all except the revolutionary debt, he had 
the cash basis. In the year nine he shouldered and 
funded the revolutionary debt, and met everything in 
cash. Not only this, but he began the repair of the 
roads, neglected for ten years. During this time he con- 
ducted, in person, the campaign ending at Marengo. 
In 1803 he made his vast preparations for the invasion 
of England. This system forced the most rigid econ- 
omy in every department. Reckless men and mere 
speculators were driven from the field, and honest and 
prudent men occupied their places. 

But he was often sorely pressed with the need of 
money. He declined so expensive a process as a re- 
sort to borrowing. There was another way to borrow: — 
to run in debt to the contractors, not paying them in 
full. They were anxious for the adoption of this 
course, but he thought it more expensive than regular 
borrowing. They would be sure to get twice or thrice 
paid, furnish inferior articles and at their own chosen 
times and in their own way, giving as an excuse that 
they could not do otherwise, because unpaid. He de- 
termined to pay the contractors regularly, and to require 
them to furnish supplies regularly and at reasonable 
rates. But war came from all quarters, so that England 
escaped invasion. In 1805 the victories of Ulm and 
Austerlitz, and the naval defeat of Trafalgar followed: 



Its Causes and Remedy. 17 

Jena and Eylau in 1806; Friedland and the peace of 
Tilsit in 1807. But once during this time was there a 
suspension, lasting but a few days, caused by the united 
merchants taking advantage of the minister, Marbois, 
whom Napoleon indorsed as honest, but dismissed for 
having made a mistake. At this time, 1805, and after 
the coalition of all the European powers against Na- 
poleon, it was proposed to resort to paper promises, 
but Napoleon wrote to Marbois, " While I live I will 
not issue any paper." He kept his word. France soon 
acquired the gold, and consequently commanded the 
markets of the world. Failing to get the command of 
the sea by the result of the naval battle of Trafalgar, 
and outnumbered more than five to one, Napoleon was 
finally defeated by combined Europe, but France suffered 
no financial crisis. When Napoleon was sent to Elbe, 
and after Waterloo, banished to St. Helena, there was 
not even a ripple in financial circles. France has ever 
since adhered to a specie basis,* the system of Napoleon, 
which, like one of his military plans, remaining invin- 
cible as long as it can be clearly identified. France of 
to-day has paid her debt to Germany in gold, and has 
sold her bonds to her own people, who hold them, for 
gald. They bear, too, a low rate of interest. Ours is in 
magnitude a European debt, bearing an American rate 
of interest. Until the time comes to pay the principal 
of a debt, the rate of interest it bears fixes its weight 
upon the country. $1,000,000 at six per cent, is just 
as burdensome to a people as $2,000,000 at three per 
cent. 

* The Bank of France has nominally suspended on account of 
the German war, but its paper has not depreciated, but it has had 
the effect of transferrin^ French balances to the Bank of Enofland. 



The Money Crisis. 



England, on the contrary, adopted the legal-tender 
system, and piled up such a debt as has prevented her 
ever since from venturing upon any great enterprise, 
while at the close of the war she was visited with a ter- 
rible financial crash and general bankruptcy. Read the 
works of Burke and Napier's Peninsular War, to learn 
the evils of the English system. The latter, speaking 
of the Peninsular war, which began in 1808, contrasts 
.the condition of England and France. " Then En- 
gland," he says, "had those twin curses, paper money 
and public credit — strength in the beginning, but weak- 
ness in the end — which were recklessly used by states- 
men whose policy regarded not the interests of posterity, 
whose system snatched the means of the many to bribe 
a few in order to misgovern all." The Bank of En- 
gland, it may here be observed, suspended specie pay- 
ments from 1797 to 1 8 19, being forbidden by govern- 
ment to so redeem its paper issues. The bank was so 
prudently managed, however, that its paper did not 
materially depreciate for ten years. In 1825 came the 
inevitable crash. 

Of France, Napier says : " Her manufactures were 
rapidly improving, her internal and continental traffic 
was robust, her debt small, 4ier financial operations con- 
ducted on a prudent plan and with exact economy " 
(which is the necessary consequence of a specie basis in 
a time when much money is required, while the very 
opposite is the case when credit is used instead of 
money) ; " her supplies were all raised within the year 
without any great pressure from taxation, and from a 
sound metallic currency." We copied, and for twelve 
years have practiced upon England's admitted and 
lamentable mistake — its blunder, which was a crime. 



Its Causes and Remedy. 19 



THE REMEDY. 

- V7hen a government has once adopted a system of 
finance, every body who desires to do any business at 
all, must do it under the adopted system. Therefore, 
when evils fall upon the people from the fatalities 
resulting from a defective system, it becomes the duty 
of all, while seeking for a safer basis, so to proceed as 
to protect all as far as possible and to cause no unneces- 
sary distress. Enough of that will ensue at best. In 
seeking a remedy, we at once direct our attention to a 
specie basis; and here it will become necessary to re- 
move a generally accepted opinion, the result of falla- 
cious assertions made to prop up and continue the paper- 
credit system, that there is not sufficient gold to main- 
tain such specie basis. This assertion has been accepted 
without proof The fact is, that, since the discoveries 
of gold in California and Australia, that metal has, in 
reality, become too abundant for the requirements of 
currency. It has lost much of its purchasing power. 
In 1803, in France, the quantities of gold and silver in 
the world were approximately ascertained, and the value 
of gold fixed at /o^jjj^tQcn and one-half times its weight / ^ 
in silver; when as early as 1859, upon a similar investi- 
gation, it was found to be worth not more than eleven 
and one-half times its weight in silver. (See Cobden's 
translation of Chevalier on Gold.) The reason none is 
in circulation in the United States, is because we have 
a cheaper money, which ever takes the field, banishing 
the more valuable. A gold basis at once brings all the 
gold coin in circulation. 

Let Congress, then, ignoring all special interests and 



20 The Money Crisis. 



classes, and looking alone to the well-being of the whole 
country, devise a wise and just system of internal taxa- 
tion, and a tariff whose object shall be the realization of 
the greatest amount of revenue instead of merely foster- 
ing, by so-called protection, certain interests. Then, 
let the legal-tender notes be made redeemable in coin, 
at their face, at the will of the holder. As they will 
furnish a uniform currency, and be less bulky and 
weighty than gold, and consequently cheaper to trans- 
port, they will be at a slight premium as between them 
and gold. This will shove all the gold into the chan- 
nels of circulation, it being the cheaper, and will prevent 
the presentation of " greenbacks " for redemption at 
all ; while the latter will be a debt of the government, 
bearing no interest. 

But it will be said that the national-bank issues are 
in the way, that they can not redeem their bills in gold. 
It is true they can not. A bank, whose paper promise 
the day it is issued, is worth less than its face in gold, 
never can afford to allow it to become worth gold ; for 
it would have to pay (lose) the difference. It may be- 
come less valuable — never more. As well might a 
bridge built with a "swag" in the bottom chord be 
expected to get "camber," or "bow up" by use — 
organic structure renders that impossible. 

But these bank charters are amendable or repealable 
at any time. Now, say the owners of a national bank 
have bought and paid for one hundred thousand dol- 
lars in registered bonds, deposited them in the federal 
treasury, and received from it ninety thousand dollars in 
bills to circulate ; these it has used, and, while doing so, 
has drawn interest from the treasury upon the entire 
one hundred thousand dollars of its bonds: it breaks ; 



Its Causes and Remedy. 1 1 

the government then assumes its circulation, having in 
hand the one hundred thousand dollars in bonds to in- 
demnify it for so doing. Now, suppose the govern- 
ment should assume all the bank issues as part of its 
own "greenback" issue, and cancel a corresponding 
amount of the deposited bonds, the value to be fixed . 

fairly on the basis of some past date : it would simply 
be turning a part of its interest-bearing debt into a non- 
interest-bearing debt — a thing that it virtually does 
when one of these banks fails. Then take away the 
right from these banks to issue bank-bills as currency, 
and provide a heavy prohibitory tax upon all local- 
bank issues," and it does seem to the writer that we 
would very soon reach a sound and prosperous basis, 
and have the best paper currency, so long as the public 
debt shall last, in the world. 

But it will be said, " H ow can the debtor class pay one 
hundred and twelve dollars in gold for what they agreed 
only to pay one hundred dollars in gold, or one hundred 
and twelve dollars in legal tenders." The answer is ob- 
vious, we have had one name, "dollar," for two differ- 
ent values. Give the creditor the very "value he con- 
tracted for, and oblige the debtor to pay that, and no 
less, nor any more. Do not stick at names or words, 
but consider values. We know the value of the " green- 
back," as compared with gold, upon every day since 
such notes were issued. Make the debtor pay the gold 
value of his promise at the time it ioiiitiiiii ilrn^ with law- p^^cui (W255^ 
ful interest. The school-boy who has worked sums 
" in exchange " in his arithmetic, is able to comprehend 
the plan at once. He can tell, their relative values be- 
ing given, how many dollars are to be paid for one 
thousand thalers. If this be not done, the strain of the 



22 The Money Crisis. 



crisis will constantly be upon the weakest part, the 
debtor class, whom it must grind to powder, and with 
theirs, bring general ruin. The government, however, 
has promised to pay "dollars," and it must redeem its 
promises in good faith. Not to do so, would bring 
upon us far greater evils than could be compensated for 
by any immediate gains. No "scaling," therefore, by 
it of its own debts, no shaving of its own paper as has 
been heret^gfbre constantly done. 

These observations are submitted, not in the belief 
that they embody perfection, but in the hope that they 
will, to some extent, serve to call the attention of wise 
and experienced men of all parties to this subject, and 
induce them to devise adequate remedies for the financial 
diseases of the times — a matter in which everybody in the 
land is vitally interested. 

C::ZiLi^, /^/M-i^-^ i^^v/^ ,, y. 






